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I Am A Proponent Of Service Reflective Tariff – Austyn Duru

Engr. Austyn Duru is the CEO of Modulus Technologies Limited. He has plied his professional career across many engineering fields. He’s an expert in Telecoms Networks, Renewable Energy, Strategic Planning and projects involving people, procedure, process and policy management. In the last 5 years, he has engaged in SME business to drive strategy from concept to application and bring ideas to reality.

Engineers’ Forum engagement with Austyn Duru remains an interesting experience as he shares great insights in engineering entrepreneurship, policy and development.

Let’s talk about engineering entrepreneurship which you are passionate about. Why is our economy so unstable and what are the factors militating against engineering entrepreneurship despite deliberate government policies on National Content, Ease of Doing Business etc

 Nigeria’s Economy is unstable because our consumption rate is higher than our production rate hence we best fit as a Consuming Economy. Engineering entrepreneurs don’t get enough patronage and our commercial banks do not fund startups no matter how good the idea may be. A society (Nigeria) that does not support innovative minds will never develop beyond importation of goods and exportation of jobs, that is the bane of Nigeria. The Government must advise the Nigerian Content Development & Monitoring Board, NCDMB to release it’s over NGN200bn to Engineering Innovations.

When you mentioned funding, will it be right to say that it is what makes it difficult for most engineering businesses to succeed in the second generation of business ownership?

No, finance is not the reason why businesses don’t thrive beyond the original ideator. Many original owners in Nigeria hoard their knowledge hence nobody inherits the full know-how of the enterprise. This makes the chances for continuity slim. In many instances, family members fight over assets and properties thereby destroying the chances of continuing a family trade. The solution to this problem is good corporate governance and strong organisational structure that encourages competent but non-familial employees to continue the business upon the demise of the original founders. The right policies, process, and procedures are needed to thrive beyond the owners.

Two years ago government enhanced engineering practice by amending the COREN Act. What will you say is the overall gains of the amendment and what additional thing needs to be done if any?

The COREN amendment is good for Engineering Entrepreneurs but its enforcement is still a challenge because the supporting structure and cooperation from professional engineering bodies are lacking. The COREN ERM team is already non-functional and has been unable to picket organisations that continued to flout the Engineers Registration Act 2018. It is a simple task but those that will benefit – Engineers – must rise up to that task of enforcement similar to how NMA enforces their rights over quackery in the Public Health sector, and NBA enforces legal representation requirement from all trained lawyer. No licence, no sign-off, it is that simple.

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You have been championing Renewable Energy as an alternative source of energy and as the panacea to our energy crisis. How will the implementation address the situation with the huge gap in energy demand and the initial cost of deployment?

The call for RE is indeed the way to go for a country that has achieved only 45% Electricity Penetration to a population of 200 million persons or approximately 30 million homes. The choice of RE is premised on two main strengths viz; (i) aligned to UN SDG#7 – clean and affordable electricity, and (ii) elimination of power losses due to long-distance transmission from a Generating Station to the Consumer appliances. The argument that power transmission at a high voltage of 330/132/66/33kV lines reduces losses does not hold any longer if the aggregate loss exceeds 10% of wheeled out capacity. This is why decentralisation of transmission infrastructure is gaining grounds. It supports the call for smaller networks called Mini-Grid which makes Renewable Energy the most viable option in terms of cost, maintainability, and quality.

Let’s look at the recent energy tariffs increase which you are a proponent of Service Reflective Tariff. What difference will it make and what are the implications of the increase to the economy?

Yes, I am a proponent of Service Reflective Tariff which I dubbed Flexible Tariff based on Grade of Service. It is finally sanctioned by NERC but the challenge is how Distribution Companies will classify a consumer based on Service availability because it is known that DisCos are exploitative and unprofessional in their dealings. To make it effective, NERC must create a new layer of Independent Assessors or better still enforce an Energy Service company layer that will drive the improvement of service to energy consumers.

There are also diverse opinions on fuel subsidy removal. What is your position and why?

Subvention is not new across the globe but the beneficiary is what is challenging. With the implementation of various NSIP programmes, it makes a lot of sense to end the subsidy regime in all sectors. Let the monies paid as subsidy be divested to help more persons living below the poverty line. Nigeria needs 450 billion Naira monthly to support 90 million poor and vulnerable, at the rate of 2 children per woman.

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You have spent a greater part of your career life in the telecom sector. Tell us about the recent NCC release document tagged, Determination on the Implementation of an Accounting Separation Framework for the Nigerian Telecoms Industry. What does that policy seek to achieve?

The Government finds the health of Telecoms Industry crucial to a thriving Digital Services era especially the advent of Payment service which comes with CBN licencing of MNOs as Mobile Money super agents. Separating the financial report by licence and products helps NCC to monitor and better regulate each licence granted as well as the products approved under such licence. The purpose is to assist licensees to attract investment for the products and business units that are not performing well but also to withdraw continually underperforming licences.

The objectives of the AS Framework are to:

  • Provide an enabling environment to foster open and transparent financial reporting within the sector
  • Assist in ensuring that charges for telecommunication services are cost-based, transparent and non-discriminatory
  • Assist the Commission in the monitoring of Operators’ compliance with regulatory obligations
  • Identify and prevent any undue discrimination or practices that substantially lessen competition such as cross-subsidization, margin squeezes, etc.

What is your assessment of QoS among the telecom operators?

QoS caters for technology service and consumer protection. NCC has defined Key Performance Indicators (KPI) that each operator must achieve or be penalised. It is similar to the Gas Flaring penalty imposed on IOCs in the oil mining sector.

NCC KPI is technical health – parameters for measuring reliability – of the MNO services and includes indicators that measures accessibility, retainability, and mobility of calls and data connections. It is different from the newly introduced ASF which deals mainly with financial health. Note: Penalties apply for not meeting NCC KPIs but there are no penalties for bad financial health.

As an engineering entrepreneur, what is your forecast on the nation’s economic outlook for 2020/21?

The NBS report for Q2-2020 shows a 6% decline in GDP hence the need to do all within our powers to avert an economic recession. I am hopeful that Nigeria will see a rebound from Q4-2020 if the government and CBN can ensure that SMEs get at least 50% of available deposits. The solution to recession is economic stimulus like credit facilities to carry out productive enterprises as well as consumer loans to trigger spending. The money must be kept in the regulated system so it can keep exchanging hands and creating wealth and value for all.

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